Product safety
and integrity
Supply chain
continuity
Information
security
Digital
media
Report of the Supervisory Board
What could happen
Poor quality or contamination of HEINEKEN
products, be it accidental or malicious, could
result in health hazards, reputational damage,
financial liabilities and product recalls.
Recent developments
Innovations and increased local sourcing have
led HEINEKEN to further strengthen controls on
ingredients, recipe governance and production
processes to maintain food safety and high quality
standards. Changes to the environment, such
as increased knowledge of the potential food
contaminants previously unheard of, growing
consumers' concern on food safety and a more
complex legal environment in certain jurisdictions,
makes control of food safety more challenging.
What are we doing to manage this risk
HEINEKEN has established a comprehensive
Company-wide Quality Assurance programme
covering production standards, recipe governance,
suppliers' governance and production material
risks. HEINEKEN anticipates on new legislation
and emerging risks aided by our partners, suppliers
and external scientific institutions and assures
implementation of measures to avoid such risks.
Should a risk materialise, global recall and crisis
procedures are in place to mitigate the impact.
What could happen
Disruptions in the supply chain could
lead to inability to deliver products to key
customers, revenue loss and brand damage.
Significant changes in the availability or price of
raw materials, commodities, energy and water
may result in a shortage of those resources or
increased costs.
Recent developments
Political instability, terrorism, climate change and,
in particular, growing water scarcity (and its effects
on crop yield and grain prices and interruption in
production), require the market and governments to
take measures which may result in additional costs
to the business.
What we are doing to manage this risk
Business continuity plans have been developed
for HEINEKEN's key brands in all key markets, and
back-up plans are in place in operating companies.
Business resilience is further strengthened through
ownership of several strategic malteries, long
term procurement contracts, water management
plans and central management of global
insurance policies. Taking a long-term approach,
HEINEKEN has included water stewardship to
protect water resources and sustainable sourcing
in the priorities of its Brewing a Better World
sustainability programme.
Explore Further:
- Protecting water resources, pages 120, 122-124.
- Reducing CO2 emissions, pages 120, 125-130.
- Sourcing sustainably, pages 120, 131-133.
Financial Statements
Sustainability Review
Heineken N.V. Annual Report 2018^ 30
Other Information
What could happen
On social media, concerns related to HEINEKEN
or any of its products, even when unfounded,
could impact the Company's reputation and the
image of its products. HEINEKEN may not be
able to control information or respond in a timely
manner to reputation threats, which could affect
its brand equity and income-generating capacity
at scale and at pace.
What could happen
HEINEKEN's business increasingly relies on IT,
both in the office environment as well as in
the industrial control domain of our breweries.
Failure of systems or security incidents may
lead to business disruption, loss of confidential
information, breach of data privacy, financial
and reputational damage.
Recent developments
To drive innovation, HEINEKEN's business functions
are pursuing digital transformation, delivering new
business models, integrating into the digital world
and increasing overall interconnectivity. At the
same time, online threats grow more sophisticated
and potential consequences are more punitive
and destructive in nature. In light of the increasing
exposure to cybercrime and changing regulations
that place stricter security requirements on data
processing, we frequently re-assess our security
exposure and posture.
What we are doing to manage this risk
HEINEKEN regularly updates its information
security strategy to ensure proportional adaptation
of capabilities in response to evolving risks.
Security Operations and Information Security
Risk Management departments maintain a
global cybersecurity framework to address
continuity, integrity and confidentiality risks, and
perform global monitoring of HEINEKEN's IT
landscape, focusing on enhancing the resilience
of the IT infrastructure and increasing employee
security awareness.
Recent developments
While robust social media risk management
measures are now in place, social media crises
increasingly happen via private channels (e.g.
WhatsApp) and cannot always be tracked.
Moreover, malicious attempts to spread false
material becomes ever more sophisticated with
substantial spend behind it.
What are we doing to manage this risk
HEINEKEN has set up continuous monitoring of key
social media platforms, in several languages, along
with employee training in digital communication.
Our incident response system includes a digital
dashboard and a dedicated crisis communication
team. Learnings from media crises are shared in the
organisation to drive continuous improvement.